The Best AI Stock to Buy Right Now, According to a Wall Street Analyst (Hint: Not Nvidia or Palantir)

Core Viewpoint - Tesla is expected to achieve a market capitalization of $3 trillion, representing a 115% upside from its current value, driven by advancements in autonomous driving technology and robotics [1][2]. Market Position - Tesla has lost its leadership in the electric vehicle market to BYD, with its market share dropping from 18% to 12% year-over-year [2]. - The company reported a 13% decline in deliveries in Q2, with revenue falling 12% to $22 billion and non-GAAP net income down 23% to $0.40 per diluted share [3]. Sales Performance - Sales in Europe decreased by 40% in July and 37% in August, while sales in China dropped by 12% in July and 10% in August [4]. - Tesla's U.S. market share fell to 38%, marking the first time it has been below 40% since October 2017 [4]. Future Opportunities - Tesla is focusing on physical AI opportunities, including autonomous ride-sharing and robotics, which could significantly increase its revenue potential [5]. - The company launched its first autonomous ride-hailing service in Austin, Texas, and plans to expand testing in Arizona and Nevada [6]. - Tesla's approach to robotaxi services, relying solely on computer vision, is seen as more scalable compared to competitors like Waymo [7]. Robotics Development - Tesla is developing a humanoid robot called Optimus, which Musk believes could account for 80% of the company's value in the future [8]. - Production scaling for Optimus is planned for next year, with a goal of producing at least one million units annually within five years [8]. Market Potential - Goldman Sachs projects U.S. ride-sharing revenue could reach $100 billion by 2030, while Morgan Stanley estimates the addressable market could be closer to $1 trillion [9]. - Humanoid robot sales are expected to reach $210 billion by 2035, with Morgan Stanley forecasting this figure could hit $5 trillion by 2050 [10]. Valuation Perspective - Tesla is currently the third most expensive stock in the S&P 500, trading at 178 times projected earnings for 2026, but this valuation may be justified by the company's shift towards physical AI [11]. - Investors with high risk tolerance who believe in Tesla's potential to disrupt mobility and labor markets may consider owning the stock [12].